Welcome to Daily on Energy, written by Washington Examiner energy and environment writers Callie Patteson (@CalliePatteson) and Maydeen Merino (@MaydeenMerino). Email cpatteson@washingtonexaminer dot com or mmerino@washingtonexaminer dot com for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list.

SCOOP – REPUBLICANS TACKLE CLEAN AIR ACT RULES FOR SMALL WELLS: A group of Republican lawmakers jointly introduced legislation in both the House and Senate earlier today aimed at easing air pollution regulations for small oil and gas companies.

The details: The bicameral legislation would soften Clean Air Act rules for the oil and gas industry, marking the latest effort from Congress to deliver on President Donald Trump’s call to “drill, baby, drill,” while also propping up the administration’s broader deregulatory agenda.

The bills, both called the Protect Domestic Oil and Gas Small Business Act of 2026, were introduced in the House and Senate by Texas Rep. August Pfluger and Wyoming Sen. Cynthia Lummis.

If passed, the legislation would amend the Clean Air Act to exempt small oil and gas producers from Environmental Protection Agency performance standards required under Section 111 of the law, including requirements for monitoring, reporting, detecting, and repairing leaks of greenhouse gases such as methane.

This would only apply to “marginal wells,” meaning an oil well site that has an average daily production of 15 barrels of oil or oil equivalent per day per well or less. For natural gas, a site must have an average daily production per well of 90,000 cubic feet or less to qualify for the exemption.

The pushback: Data compiled by the Rocky Mountain Institute estimates that there are roughly 576,249 marginal wells across the United States, more than 70% of the total number of wells recorded. However, these low-production wells account for only about 5% of annual production. 

Despite this, environmentalists have warned that these facilities have disproportionate levels of greenhouse gas emissions.

“While Americans are struggling with sky high energy prices, it is tone deaf that some in Congress want to allow huge new sources of energy waste and pollution,” Joanna Slaney with the Environmental Defense Fund said, claiming the bill “would only add to the more than $5 billion in wasted American natural gas created since the Trump EPA froze enforcement of commonsense methane requirements.”

Read more on the joint bills from Callie here. 

TRUMP ROLLS BACK BIDEN REFRIGERATOR RULES: President Donald Trump has announced a plan to roll back two Biden administration rules on refrigerators in an effort to lower grocery prices. 

At the Oval Office today, Trump was joined by EPA Administrator Lee Zeldin to announce the overhaul of Biden administration refrigerator rules, which the administration claims would save businesses and consumers $2.4 billion per year. 

What are the rules? The EPA would look at revising the 2023 Technology Transitions Rule by extending the deadlines for groceries and other companies to phase out the use of hydrofluorocarbons, which is a synthetic gas used in cooling systems that is classified as a “super pollutant.” 

The agency will also propose changes to the 2024 Emissions Reduction and Reclamation Program that would exempt all refrigerated road transport equipment used for shipping goods from new HFC leak regulations.

The rules were promulgated by the Biden administration in 2023, but Trump in 2020 signed the bipartisan American Innovation and Manufacturing Act giving the EPA authority to phase out HFCs. 

Lawmakers reaction: Republican Rep. Craig Goldman of Texas, who was in attendance at the event said, “Repealing Biden-era regulations on commercial refrigerators is a common-sense solution to lower food costs.” 

Opposing reactions: The Air-Conditioning, Heating, and Refrigeration Institute and the Alliance for Responsible Atmospheric Policy said the rule would raise the risk of higher prices by increasing demand for existing refrigerants while constricting supply. 

“By extending the compliance deadline, the EPA is maintaining and even increasing demand in the market for existing refrigerants while supply continues to fall under the AIM Act. So, instead of falling, refrigerant prices are likely to rise, resulting in higher service costs, and higher costs for consumers,” Stephen Yurek, AHRI president and CEO, said in a statement. 

Read more by Maydeen here.

STRAIT OF HORMUZ FLOWS MAY NOT RETURN TO NORMAL UNTIL EARLY 2027: The United Arab Emirates’ state oil firm ADNOC is warning that full, normal flows of crude oil through the Strait of Hormuz may not resume until the first or second quarter of 2027.

This is one of the most pessimistic views shared on when oil trade through the strait will return to pre-war levels, as the war in Iran inches closer to the three month mark. 

“Even if this conflict ends tomorrow, it will take at least four months to get back to ​80% of pre-conflict flows, and full flows will not return before the first or even second quarter of 2027,” ADNOC CEO Sultan Al Jaber said yesterday, according to Reuters. 

He warned that the extended closure of the strait sets a “dangerous precedent” for other crucial waterways and even maritime navigation as we know it. 

Related – nearing a red zone: As oil markets start to hit summer demand peaks, International Energy Agency chief Fatih Birol has said the industry may enter a “red zone” in July or August unless there are significant improvements to oil flows through in the Middle East. 

He did not explain what this “red zone” could look like, only emphasizing the importance of reopening the Strait of Hormuz, according to The Guardian. 

PRESSURE ON PRICES: Oil markets saw significant volatility today as traders continue to try and speculate when the U.S. and Iran come to an agreement on ending the war and reopening the strait. 

In early trading, prices fell by nearly 6% as shipping data revealed two supertankers headed for China passed through the waterway, according to the Financial Times. This appeared to be a major indication that Iran was preparing to lift its own blockade, at least in part. 

Hopes of an agreement were dashed hours later, however, after Reuters reported that Iran’s Supreme Leader Ayatollah Mojtaba Khamenei ordered near-weapons-grade uranium to remain in Iran. As the U.S. is unlikely to agree to such a proposal, prices ticked back up. 

By this afternoon, international and domestic benchmarks fell once again, after Secretary of State Marco Rubio told reporters that there were “some good signs” the administration could reach a deal. 

As of around 2:30 p.m. EDT, Brent Crude was down by 1.78% and selling at $103.15 a barrel, while West Texas Intermediate also fell 1.42% and was priced at $96.86 per barrel. 

WHAT ENERGY CHOKE POINTS COULD BE NEXT: The closure of the Strait of Hormuz has tanked the global economy and driven oil prices up, raising the question of what other waterways could cause this type of fallout if another bad actor sought to exert control over them. 

So, Callie teamed up with the Washington Examiner’s defense reporter Mike Brest to take a closer look and identify several other major channels and straits crucial to global flows of energy products. 

1. The Bab el Mandeb Strait, which separates the Red Sea and the Gulf of Aden, is the only entry point to the Red Sea from the Indian Ocean. More than 4 million barrels per day of crude and other petroleum products pass through the strait each year.
2. The Suez Canal connects the Mediterranean Sea to the Red Sea in Egypt. Nearly 5 million barrels per day of crude oil and petroleum liquids travel through the canal each year, attracting up to 15% of global trade.
3. The Panama Canal is another choke point that has seen increased crossings in light of the war in Iran. In 2024, around 2 million barrels per day of crude oil and petroleum liquids passed through the waterway.
4. The Strait of Malacca connects the Indian Ocean to the South China Sea, and is governed by a series of agreements between Singapore, Malaysia, Indonesia, and Thailand. Roughly a third of global trade and more than a quarter of the world’s seaborne oil travels through the strait. 
5. The Turkish Straits connect the Black Sea to the Mediterranean, acting as the only maritime link connecting much of Eastern Europe to global sea trade. Roughly 3.7 million barrels of crude and petroleum products flow through these straits, which include the Strait of Istanbul, the Strait of Canakkale, and the Marmara Sea, each day.

Read more from Callie and Mike here. 

NOAA BELOW-NORMAL ATLANTIC HURRICANE SEASON DUE TO EL NIÑO: The National Oceanic and Atmospheric Administration is predicting below-normal hurricane season in the Atlantic this year due to upcoming El Niño weather.

NOAA is predicting a 55% chance that the Atlantic will witness a below-normal season, which typically runs between June 1 and November 30. 

The agency said there could be a total of eight to 14 storms with winds at or higher than 30mph, but of those storms only three to six will become hurricanes with winds of 74 mph or higher. The agency said that only one to three will be major hurricanes of 111mph or higher. NOAA said it is 70% confident in these ranges. 

A typical season has an average of 14 storms with half being hurricanes, including three major hurricanes. NOAA said the key factor driving the forecast is due to the potentially strong El Niño, which is expected to intensify during hurricane season. 

“Although El Niño’s impact in the Atlantic Basin can often suppress hurricane development, there is still uncertainty in how each season will unfold,” NOAA’s National Weather Service Director Ken Graham said in a statement. “That is why it’s essential to review your hurricane preparedness plan now. It only takes one storm to make for a very bad season.”

In the Pacific: Unlike the Atlantic, the eastern and central Pacific will likely see the opposite effect with El Niño bringing more hurricane activity this year. 

NOAA has said that there is a 70% chance that the Pacific will see an above-normal season with 15 to 22 storms. Of those storms, about nine to 14 will be hurricanes and five to nine will be major hurricanes. 

CALIFORNIA COULD CUT ELECTRICITY COSTS BY $44 BILLION, CAFT REPORTS: A new report by the Clean Air Tax Force said next-generation geothermal energy could reduce Califonria’s electricity costs by $10 to $44 billion per year. 

CAFT report urged California to boost its geothermal energy development to help reach its net-zero goal in 2045. The report noted that in-state development could produce an additional $3.5 to $5.5 billion in annual savings compared to sourcing the energy from out-of-state. 

The report noted that developers currently lack the subsurface data to identify potential geothermal locations for early projects and exploration is challenging to finance through the price market. California also imports zero-emission power to meet its electricity needs but does not receive its economic benefits, the report said. 

“California is effectively paying to develop geothermal in other states,” Terra Rogers, senior director of Superhot Rock Geothermal at CATF said in a statement. 

“Ratepayer money is flowing, but the jobs, the tax revenue, and the long-term energy security are going to states like Utah and Nevada, where the subsurface is better understood. A targeted state investment in next-generation geothermal exploration in California could help reverse that trend,” Rogers said. 

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